TOO MUCH SILVER.

New Zealand Herald, Volume LX, Issue 18334, 26 February 1923, Page 9

TOO MUCH SILVER.

LONDON BANKS' DILEMMA.

MANY MILLIONS DEPOSITED.

APPEAL TO GOVERNMENT.

The banks are overflowing -with silver, -ays a London paper. War time needs and the inflation boom that followed made exceptionally large quantities of silver coins necessary for wages and the hundred and one small things of life. That need ha* largely gone, and where two coins were needed ona now suffices. The result ia that many millions 0 pounds of silver have been deposited with the banks, who are at their wits* end to know what to do with it. The Mint has helped to soma extent. j t W as announced during the last session of Parliament that the Mint had incurred an expenditure of £750,000 in connection with the withdrawal of silver from circulation Normally 'the Mint refuses to accept silver coinage except when other silver coinage is taken in exchange. This tear however, the Mint found itself "morally bound to come to the rescue of the banks. ~..., R»lr>blo estimates mdicace that there is at least from £15,000,000 to £20X00,000 too much silver coinage in issue— thine i;i ;e 100 COO tons— most of this is in the hands of the banks. Their vaults are full, and it is even whiiWed that some of the dungeons in the Tower of London have, been requisitioned to store this surplus metal. Urgent representations are being made to the Government. Meanwhile, the silver market ii» asking • what the Mint is doing with the surplus silver which comer, into its possession as the process of recoinage roes on. ...... , . Large quantities, it is known, have been gold to China and the East generally. Fortunately for the market, tho process is a comparatively slow one. More than 360.C03.000 worth of silver coinage is believed to have been in circulation in 1920, •when the Recoinage Act was passed, and it is believed thai not more than half of this has so far been exchanged at the Mint for now coins.